Jury Finds NYT Defamed Business but Caused Zero Damage

Shannon P. Duffy reports that

in a quirky conclusion to a libel suit against The New York Times, a federal jury Monday found that the newspaper had defamed a Philadelphia business and had done so "intentionally, recklessly or negligently," but that the plaintiff was entitled to no money since it had not suffered any "actual harm."

In the case, plaintiff Franklin Prescriptions Inc. in Philadelphia claimed it was the victim of "defamation by implication" when The New York Times used a portion of Franklin's Internet site as a graphic to illustrate an Oct. 25, 2000, article headlined "A Web Bazaar Turns Into a Pharmaceutical Free-for-All."

Although, the jury agreed that plaintiff had been defamed because a list of "safety tips," published just to the right of the Franklin graphic, warned readers to avoid Internet sites of pharmaceutical companies that do not list a phone number or address; plaintiff was unable to convince the jury that they had lost any sales due to the article.

Interestingly, part of the NYT's argument as to why Franklin had lost sales was due to plaintiff's poor search engine optimization and the fact that it was no longer listed among the top sites when searches for infertility drugs were conducted. Sounds like a rather sophisticated jury that understands search engines.

For background, read Defendant's motion for certification of interlocutory appeal or, in alternative, for reconsideration of court's denial of defendant's summary judgment motion which was denied in its entirety.